The Italian energy company, Eni, has decided to sell part of its gas assets in Indonesia to national companies Pertamina and Medco. This move is aimed at reducing financial risks and focusing on other key projects. However, Eni will still retain operational control and significant ownership of these assets.
Details of Transactions with Pertamina and Medco
In these transactions, Eni will sell 10% of its stake in Production Sharing Contracts (PSCs) in the East Sepinggan, North Ganal, and Rapak fields to Pertamina. This includes the producing gas fields Merakes and East Merakes and the gas discoveries Geng North–Gehem, which are being developed as part of the North Hub gas project, considered a strategic national project.
On the other hand, Medco will purchase 10% of Eni's shares in the PSCs of West Ganal, East Ganal, Ganal, and Muara Bakau. This agreement includes the producing gas fields Jangkrik and the gas projects Maha, Gendalo, and Gandang, which are being executed as part of the South Hub project. These transactions are subject to usual governmental and legal approvals.
Implications of These Developments for the Indonesian Gas Industry
These transactions come after the launch of the Searah project and successful explorations in Geng North and Geliga, which have identified over 10 trillion cubic feet (tcf) of gas and 650 million barrels of condensate. Final investment decisions (FIDs) were also announced last March for the North Hub and South Hub projects.
The Searah project, which includes 19 gas production and development assets, currently produces about 350,000 barrels of oil equivalent per day (boe/d) and aims to achieve sustainable production of over 500,000 boe/d by 2028. Eni is also actively working on the PSC Peri-Mahakam, PSC Makassar Strait, and the recently awarded Sapukala block.
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